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Published on : Thursday, November 26, 2020
On Tuesday, International retail chains were experiencing the adverse consequences of the fall down of the world travel sector, as Abercrombie & Fitch said it would accelerate the closure of flagship stores in all the major tourist destinations and Tiffany stated that in Europe and the Americas, its sales have dropped sharply. Abercrombie & Fitch, the clothing chain, declared that it would close down large stores in London, Paris and five prime locations after visitor slouch during COVID compounded their long-running underperformance.
Almost all in Europe, the stores are closed and before their leases were due to expire — occupy about 200,000 sq ft, or about a tenth of the US-based clothing brand’s total space.
“Tourism has kind of ground to a halt” during the pandemic, Scott Lipesky, Abercrombie & Fitch’s chief financial officer had mentioned in a recent interview. That had actually caused a “meaningfully worse” performance at stores quite well-known among tourists.
The company mentioned that it had a “multiyear strategy of reducing dependence on tourist-driven locations”. A decade back, the stores were “really the way into our brand” for foreign travellers, Mr Lipesky said, “we can reach these customers these days through social media and digital marketing”.
The flagship stores near Savile Row in London, occupied by Abercrombie & Fitch for 13 years, and in Paris and Munich are to be shut down by the end of January 2021, well before their leases expire. A Düsseldorf store closed in the third quarter, which was also earlier than planned.
Besides early exits, the company explained that in early January, it would close down stores in Brussels, Madrid and Fukuoka due to natural lease expirations. Clothing stores such as Abercrombie & Fitch have been majorly impacted by the pandemic. The Ohio-based company, which manages the Hollister brand as well, reported on Tuesday about a 5 per cent drop in third-quarter net sales to $820m. A 43 per cent increase in online sales helped to soften the blow.